Telecom’s IT services arm Gen-i faced tough trading, with revenues dropping across most of its business in the last quarter. Overall earnings before income tax, depreciation and accounting charges fell by close to thirty percent, as customers cut spending and increased competition bit in Gen-i’s mobile and data businesses.
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Telecommunications earnings from local service, mobile, data and calling revenue all dropped significantly, mainly due to customers consolidating access lines, Voice over IP usage and price declines. Broadband and internet, however, was up from $6m to $7m but mobile revenue was relatively flat, despite Telecom’s new XT network and the marketing drives associated with it. IT solutions revenue declined a moderate 3.5 percent to $111m in the quarter ended September 30, 2009, buoyed by a twenty-five percent in internal revenue from the Telecom Group. Gen-i culled the number of full-time contractors by over half in the September quarter, for both telecommunications and IT solutions, reducing labour costs by six percent. However, this was offset by increases in permanent employee numbers.